Japan's Renesas pushes into autos with $3.2 billion Intersil buy
By Makiko Yamazaki
TOKYO (Reuters) - Renesas Electronics Corp (6723.T: Quote) on Tuesday said it has agreed to buy U.S. chipmaker Intersil Corp ISIL.O for $3.2 billion, an all-cash deal that bolsters the Japanese group's efforts to refocus the company around automotive chips.
Slowing growth in computers and smartphones - the traditional mainstays of the chip industry - has fueled a wave of mergers globally as chipmakers turn to areas such as auto electronics for sales growth.
Renesas, created from the semiconductor units of several Japanese companies, has amassed a significant war chest since a state fund and key clients bailed it out after the Fukushima earthquake five years ago.
"It was a competitive bid and we settled at a price almost at the maximum limit," Renesas CEO Bunsei Kure told a briefing for reporters and analysts in Tokyo.
"We can combine our products and offer them in a package," he added, saying the chipmaker would "actively seek out other mergers" to further grow its business.
Kure's company paid $22.5 a share for Intersil, 14 percent above Monday's closing price.
"They might be over-paying just a little, but if Renesas doesn't buy Intersil they will struggle to supply customers in the U.S.," said a manager at an investment fund in Singapore that owns Renesas shares.
"If they want to be a top auto-industry component maker they have to do this," he added, asking not to be identified because he was not authorized to talk to the media. Continued...